We recently connected with Timothy Krause and have shared our conversation below.
Tim, thanks for taking the time to share your stories with us today It’s easy to look at a business or industry as an outsider and assume it’s super profitable – but we’ve seen over and over again in our conversation with folks that most industries have factors that make profitability a challenge. What’s biggest challenge to profitability in your industry?
In my experience most accounts and CPA are really creatives with numbers and charts. Often I have found as a non-accountant that there is a large lack of focus on streamlining a few deliverables. Also due to the nature of the demand in the accounting space many accounting firms grow to the limit of the owners ability/ desire to manage people. Often this accidental growth is not done with intention and is often a frustrating place for the business owner to remain.
Tim, love having you share your insights with us. Before we ask you more questions, maybe you can take a moment to introduce yourself to our readers who might have missed our earlier conversations?
I was brought in a very business centric house hold. So from when I was 13-23 years old, I worked part time for my Opa on his rentals, he had around 50 doors. In 2007 I got my RE license and watched the real estate market crash as I tried to help my parents with their flipping business. I then swore off real estate and business for a while. Roughly 5 years later I turned my passion for video into a video production company, videos crafted. I shot around 100 videos per year, using over seas contractors and went around the world twice, to iceland and bosnia. In 2020 I transition to real estate after a video job in Texas from Washington. I then started flipping land with overseas help again. I flipped over 70 pieces of land in 3 years and sent out over 140k pieces of mail. In 2023 the land flipping was really slowing and my mother who was a CPA and had a small business suggested that I come help her with the business. I joined the accounting business as a COO. Over the next 12 month we bought a small book of business increased staff size from 5 to 12 and tripled the income and net profit when compared with the first month I started. I’m still doing the accounting business now and just considering offering Fractional COO services, we’ll see I have a few test projects going. I’m a huge fan of leverage, mainly though putting in the work to create systems and lately having my team I train how to make their own systems.
What else should we know about how you took your side hustle and scaled it up into what it is today?
I did photography then when I started EMT school I movd to video production. For a few years a shot videos on the side. During this time learning to not spend all that I made. After a few years of trying to market my services really poorly I got a back injury in the ambulance. That helped me move to a carpet cleaning job, but after 3 months my back was killing. So I quit and really put in sometime to a networking group. After 2-3 months I went from $500/mo to $5,000/mo!
Can you tell us about a time you’ve had to pivot?
In 2021 I sold $1.4m in land with around a 20% profit margin, then in 2022 I sold $1.4m in land and made around $30k, that year was super hard! Opex were still $400k. So looking at my cash projections and remembering when my parents lost everything post 2008 and they took 10 years to pay off the debt. I was not too excited to stay in that business with that structure. So I decided to pivot to the accounting business.
Contact Info:
- Website: mycornerstonecpa.com
- Facebook: https://www.facebook.com/tim.krause.963
- Linkedin: https://www.linkedin.com/in/tim-krause-776796a1/